WHY THE ADDITIONAL FEES?
Published March 22, 2023
Community association management
agreements are a common way for homeowner's associations (HOAs) and
condominium associations to ensure that their communities are
well-maintained and properly managed. These agreements typically
include various services, such as maintenance of common areas,
financial management, and communication with homeowners.
One common approach to pricing these
agreements is to offer a pay-as-you-go model rather than charging
one full price for everything. There are several reasons why this
approach can be beneficial for both the community association and
First and foremost, a pay-as-you-go
model allows community associations to tailor their agreements to
the specific needs of their community. Different communities have
different requirements for management services, and a
one-size-fits-all approach may not be appropriate. By offering a
variety of services on an a la carte basis, community associations
can ensure that they are meeting the unique needs of their
community, while also controlling costs.
In addition, a pay-as-you-go model
allows community associations to be more flexible in their
management approach. For example, suppose a community has a
particularly busy season or a major project that requires additional
management support. In that case, they can add the necessary
services for that period. This helps ensure that the community is
adequately managed during times of increased demand while also
avoiding unnecessary costs during slower periods.
For instance, in the case of a
construction project, the management company's Regional Director
would likely be more involved with the property, and more attention
would be required to address any concerns with the project. In such
a scenario, it would be reasonable for the management company to
charge an additional fee for their services. When services are
priced separately, members can see exactly what they are paying for
and how much it costs. This helps build trust and confidence in the
community association, as members can be assured that their money is
being spent wisely.
In closing, a pay-as-you-go model can
help to reduce the financial burden on community association
members. By offering services on an a la carte basis, members can
choose which services they need and can afford rather than being
forced to pay for everything upfront. This can help to ensure that
community association management remains accessible and affordable
for all members, regardless of their financial situation.
Regarding potential kickbacks, while
it’s uncommon, it goes without saying that such unethical practices
have no place in the business world, and any manager found guilty of
demanding or accepting kickbacks should face the full force of the